Rock Island daily Argus., 1887-08-11
A CORNER on BONDS
THAT LOOKS JUST NOW LIKELY TO
CONE TO GRIEF.

How Some Enterprising Einsneiers Thought
They Saw a Pretty Speculation and the
Reasons Why 1t Don't Look So Pretty
Now-Drousht Stricken Crops-Hodge's
afistake-Haggerty's Pass
cent bonds s., ~, 0ug were offered to the
treasury Wednesday at prizes ranging from
10 fiat to ll2
The probabilities attending the action af
Secretary Fairchild in purchasing Al per
cent bonds is widely discpSsed in financial
circles here, with conflicting opinions. Some
bankers and brokers say that the government
can not afford to pay more than market
rates; while Others think the bonds good
purchase at II03s. or even Ill However, this
may be, many think it not likly that any
large amount viii be offered even at Ill, and
that the effort to put out any large sum from
the treasury to relieve a prospective strin-
gency IN The money market viii fan 1t is
understood that Secretary Fairchild does not
feel warranted in paying more than 10 fat
tor these bonds.
Some months ago a large speculation in
government b1nds was started 1t was pri-
mariiy IN the Is of 1897, but in order TO ad-
vance the price Of these It was necessary to
hold up the price Of 1 : OF 1891. One year
ago the national hanks held sitt5 00, 600 of
the 5 I%er cents To secure circulation. After
the pIniou OF the attorney general that
called bonds could mol be used as security for
circulation. it was concluded toy certain
fiuaucieis that the baEks would have to buy
a hundred millions Of government bonds dur
ing the year Therefore the SPECTATORS
bought freely Of government bonds, expect
iDg to be able to unload at a handsome ad-
vance on the national hanks.
Two things inteFierei with this deal The
comptroller Of tine currency. in calling the
attention of the national banks to the opinion
ut the attorney general assured them that he
would be entirely reasonable, and would not
compel them b hasten unduly in the Suhsti-
tuition Of other for called 3 per cent bonds
BE cautioned them against doing anything
to excite the market or force the prices Of
government bonds upward The other otrSta-
cls IN the way of the speculation was the con
clusiJn Of a large proportion Of the hanks
that held called bonis to reduce their circu.
la'ion- Instead of replacing the whole slGS,-
Uo, ,UG Of : pr cents. called during the year
onls about S20, tu0Uco have been replaced.
The establishment of new banks has created
some demand for bonds III addition 10 this
substitution. but II has been comparatively
small. The statement Of the comptroller Of
the currency on the lst day of August
showed that the natianal bank circulation
actually outstanding had been reduced So
5ll SIS during the preceding twelve months,
and that the Cross reduction IN circulation
secured BY United States bonds during the
twelve months was So. .i7I. 80 The Spacula-
tors found themselves with a large quantity
OF government bonds on hand and without
the market for them they anticipated Gov.
ernment bonds began to 60 down instead Of
uT.
It became necessary for the SPECTATORS to
DO -onlethinz ia hold tine market up They
BEGAN with great industry TO circulate reports
that the accumulation of great surplus OF
money III the treasury was going to create q
strincency, ami there might be panic, and
nobu,lv knoas what dreadful things would
happen uuless the treasury relieved the
business world by buying bonds. They made
very good progTess in their efforts to create
public sentiment that the treasury must buv
bonds or stand responsible for terrible results
to trade
Wednesday one Of the leading concern:
that has been CARRYING large lot bonds and
has been irving TO MAKE the government buy
as long as the hanks will not, comes forward
with SZjsl,ts1 of bonds which it willing tc
sell at per cent mere than could be got for
registered bonds Tuesday and per cent
more than was asked for them last THURSDAY
The speculators are expecting the govern
ment TO save them from the loss the failure
Of the banks to buy bonds threatened them
with
But here they were disappointed Of the
more than 5000. go offered Wednesday onlv
one bid was aecepted-that of the Suffolb
Savings bank Of Boston, which offered SEQ.
90 in registered bonds at 40 fat